Electric vehicles left out in the cold in 2022 Federal Budget

While the 2022 Federal Budget offered some short-term relief for motorists, electric vehicle buyers once again missed out on any incentives.

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Hopes for a Federal Government boost to its Future Fuels and Vehicles Strategy were dashed in the 2022 budget, with no further commitments made towards its existing 2021 policy – and no extra helping hand to electric vehicle (EV) buyers.

While motorists around Australia received some immediate – albeit temporary – relief in Tuesday’s budget, with the government confirming it would halve the fuel excise from 44.2c to 22.1c per litre, no additional funding has been made available to incentivise electric vehicle uptake and ownership.

Last year, the Federal Government announced $2.1 billion – partially funded through the private sector – would be earmarked for low emission and future fuel technologies, with a further $250 million commitment aimed at public charging infrastructure, heavy vehicle fleets, light commercial vehicles and household smart charging.

Sales of electric cars may more than double this year, from a record high of 20,615 in 2021.

Already in 2022, sales of electric vehicles and plug-in hybrids are tracking well above 2021 levels, up 104 per cent year-on-year to the end of February. So far this year, Australians have bought 1840 electric and plug-in hybrid vehicles (excluding Tesla) against 901 over the same period last year.

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But, anyone looking for further incentives for electric car owners and buyers in this year’s budget were left wanting with no sign of tax relief for the burgeoning technology.

While several states currently offer rebates on EV purchases, the federal government has yet to incentivise individual buyers, focussing its energies – and money – instead on infrastructure and fuel technologies.

Calls for a federal tax incentive have so far fallen on deaf ears, leaving it to the states and territories to form their own strategies.

However, the mechanism for a federal tax rebate already exists – buyers of light commercial vehicles already able to claim their purchases of dual-cab utes and delivery vans as a tax deduction.

And an easing of the luxury car tax, either broadly or specifically on electric vehicles, could also ease the pressure on prices of new EVs, but calls for scaling back the tax designed to protect Australia’s now-defunct local car manufacturing industry have also fallen on deaf ears.

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